Hanoi launches programme to become start-up city

The Department of Information and Communications of Hanoi has worked with several agencies to develop an information technology business incubator scheme to promote start-ups.

The Department of Information and Communications of Ha Noi (DIC) has worked with several agencies to develop an information technology business incubator scheme to promote start-ups.

The aim is to develop Ha Noi as a start-up city, Director of the DIC Phan Lan Tu said at a briefing held this week to review the performance of the department in the first six months. He said the Government had talked a lot about Viet Nam becoming a start-up country and Ha Noi was eager to become a start-up city.

In May this year, the Prime Minister approved a draft project called "National Programme to Support Innovative Startup Ecosystem in Viet Nam by the year 2025" to create a favourable environment to promote and support the development of start-ups with high-growth potential.

The project has set the following targets for 2020: complete the main legal framework for a start-up ecosystem; run an online portal for the National Innovative Start-up Ecosystem; support about 800 start-up projects and 200 start-up enterprises, of which 50 will raise follow-on investment from private venture investors or will undergo mergers and acquisitions worth about VND1 trillion (about US$50 million).

By 2025, the project is expected to have supported 2,000 start-up projects and 600 start-up enterprises, of which 100 will have raised follow-on investment from private venture investors, or will have undergone mergers and acquisitions worth about VND2 trillion.

State funding will only be provided to support start-ups in their earlier stages. Subsequently, support from private investors and organisations will play a vital role in ensuring the efficiency and sustainability of the start-up ecosystem in Viet Nam.

Tu said the Ministry of Information and Communications (MIC) would have a start-up scheme in ICT. Currently, DIC is building a start-up project in Ha Noi.

The department has also worked with relevant bodies in order to compile a report for the city administration about  IT incubator schemes to enhance start-up activities for small- and medium-sized enterprises.

In the first six months, the department also finished preparing an information technology development programme for the 2016-20 period and a plan to build a software and digital content park.

By the end of June this year, the capital city had issued investment licences to 98 foreign direct investment firms in the field of information and communications technology. Among them, 29 are new projects with a total investment capital of $1.55 billion.

In June alone, Ha Noi's total turnover from the export of electronics, PC accessories and peripherals reached $901 million.

EU, VN firms discuss tie-up in water, environmental technologies

A European delegation comprising 30 business executives from environmental and water technologies companies met their Vietnamese counterparts in HCM City on July 14 to network and explore business opportunities.

Speaking at the event, Vo Tan Thanh, director general of the Viet Nam Chamber of Commerce and Industry in HCM City, said the EU has been one of Viet Nam's most important trade partners for the past two decades.

Bilateral trade last year was worth US$41.4 billion, a year-on-year increase of 18 per cent.

Since European and Vietnamese products and services are more complementary than competitive, the two sides can continue to increase trade, Thanh said.

Talking about water and the environment, he said in recent years combating global warming and protecting the environment have been among the most significant concerns the world over, including Viet Nam, he said.

Viet Nam has had to deal with many disasters caused by El Nino and climate change, he said.

"Therefore, both our Government and people are trying their best to build a green economy and ensure sustainable development."

With its strengths in technology, "The EU is a significant partner for us in this."

Tom Corrie, deputy head of the co-operation and development section at the EU Delegation to Viet Nam, said it is now an interesting time to do business in Viet Nam.

Its economy is very dynamic, growing at 6-7 per cent a year, he said, adding that free trade agreements, in particular the European-Viet Nam FTA, which takes effect in 2018, would create opportunities for businesses in the two countries to work together.

The business mission came to HCM City as part of the EU Business Avenues in South East Asia programme (EUBA) to help SMEs tap business opportunities in the fast-growing region.

The programme will see 20 targeted week-long business missions to Southeast Asia for up to 1,000 European SMEs in a range of sectors over the next five years, with the inaugural mission focusing on environmental and water technologies visiting Singapore and HCM City.

In HCM City, the visitors introduced a broad range of solutions to address the acute problems faced in Asia – the lack of clean water and environmental degradation.

Tran Thi Hieu Hanh, deputy director general of the city's Department of External Relations, said HCM City always welcomes and creates favourable conditions for foreign investors to invest and do business in the city.

The event was organised by the VCCI's HCM City branch, EUBA and others.

Taiwan Excellence 2016 commences in Ha Noi

The seventh edition of Taiwan Excellence, a campaign to promote top Taiwanese products in Viet Nam, begins today at Aeon Mall Long Bien in Ha Noi.

The three-day event will see the display of products of 43 brands in different fields such as ICT, home appliances, healthcare and fitness, besides transportation that have won the Taiwan Excellence Award.

Representative of the Taipei Economic and Cultural Office in Viet Nam Richard R C Shih said the launch of the seventh Taiwan Excellence event in Viet Nam, in which many Taiwanese brands are participating, was attributable to domestic consumers' support to good-quality Taiwanese products across several years.

In his speech at the press conference on Thursday, Shih said he hoped Taiwanese products showcased at this year's event would be always chosen by Vietnamese customers, contributing to enhanced relations between Viet Nam and Taiwan.

Taiwan Excellence is an international campaign organised by the Bureau of Foreign Trade under the Ministry of Economic Affairs, and implemented by the Taiwan External Trade Development Council, with the purpose of introducing and promoting cutting-edge Taiwanese products.

After six successful years, Taiwan Excellence has created a great opportunity for Vietnamese customers to experience top products from outstanding and global Taiwanese brands.

Bilateral ties between Viet Nam and Taiwan has developed significantly in the past few years.

According to the Foreign Investment Agency, Taiwan is Viet Nam's fourth largest source of foreign direct investment, having invested more than US$1 billion in the first half of this year.

The latest addition brings Taiwanese investment in Viet Nam to about $31.87 billion, making Taiwan rank fourth among 116 countries and territories investing in the country.

VN is fourth largest squid exporter to Japan

Viet Nam has become the fourth largest exporter of squid and octopuses to Japan in the first five months of this year.

Statistics of the International Trade Centre showed that Japan imported 3,777 tonnes of squid and octopuses in the period, making Viet Nam the fourth largest exporter of these products to Japan among 23 countries and territories, after China, Morocco and Mauritania.

The export prices of squid and octopuses of Viet Nam to Japan averaged US$6.4-$7.06 per kilogram in the period.

According to the Viet Nam Seafood Exporters and Processors, Viet Nam's squid and octopus exports to Japan were worth $36.32 million in the first five months of this year, dropping 4.1 per cent year-on-year.

Japan was the second largest importer of Viet Nam's squid and octopuses, accounting for 25.5 per cent of the country's exports, following Korea, which saw a drop of 14 per cent in its exports in the period.

Central region works to boost industrial development

Fifteen provinces and cities in the central and Central Highlands regions spent 32 billion VND (1.4 million USD) altogether on stimulating industrial progress, as heard at a conference held in Quang Ngai on July 15.

Of the total, 12 billion VND (540,000 USD) was sourced from the State budget.

The funding was channeled into human resources training, technology transfer and development of industrial clusters, among others.

Public-run centres for industrial development in these localities reeled in five billion VND (225,000 USD) from consulting services for 211 projects in 2015 and 2.2 billion VND (99,000 USD) from 100 projects in the first half of 2016.

Speaking at the conference, Ngo Quang Trung, Head of the Agency for Regional Industry Development under the Ministry of Industry and Trade urged the 15 provinces and cities to strengthen their connection for the overall improvement of the two region moving forwards.

Binh Thuan to strictly handle illegal Chinese dragon fruit traders

Standing Deputy Secretary of the Party Committee of the central province of Binh Thuan, Huynh Thanh Canh, has directed local departments and agencies to strictly deal with Chinese fruit traders illegally operating under the cover of Vietnamese businesses in the locality.

The provincial has set up an interdisciplinary inspection group (or Group 2241) to investigate and deal with Chinese traders who have illegally traded dragon fruit in Binh Thuan since early this year.

At the inspection group’s advice, the provincial People’s Committee has imposed fines worth 410 million VND (18,600 USD) on 17 Chinese nationals for entering and working in Vietnam without permission from authorised agencies.

The province also fined two Chinese citizens 50 million VND (2,270 USD) for illegally doing business in Vietnam, seizing 12 tonnes of packed dragon fruit.

Meanwhile, the provincial Migration Management Office shortened the duration of stay in Vietnam for those committing administrative violations for the first time. Those who repeat the offence will be banned from entering Vietnam for certain duration.

Binh Thuan currently has over 26,000 hectares of dragon fruit farms, accounting for 80 percent of the country’s total dragon fruit area and output.

According to the provincial People’s Committee, 232 organisations and individuals are involved in trading the fruit in the province.

Currently, only about 15-20 percent of the dragon fruit output is sold in the Vietnamese market, while the majority is exported to China via unofficial trade.

Chinese firms seek investment in Ha Giang province

A business delegation of Yantai city in the Chinese province of Shandong had a working session with officials of Vietnam’s northernmost province of Ha Giang on July 15 to explore investment opportunities there.

Chairman of the Ha Giang provincial People’s Committee Nguyen Van Son briefed his guests about local socio-economic development and potential, noting that the mountainous province has a 277km borderline with China and boasts numerous advantages for developing agriculture, forestry, processing and cross-border trade.

He pledged the best possible conditions, including favourable mechanisms and policies, for Yantai businesses to invest in Ha Giang.

Son said he hopes Yantai firms will invest in such projects as cattle farming in Dong Van stone plateau, building a border trade fair centre near Thanh Thuy International Border Gate, and developing eco-tourism in Bac Quang district. He also suggested Chinese companies apply science and technology in farming rare medicinal orchid species in Hoang Su Phi district.

Song Quanfa, Chairman of the Yantai small- and medium-sized enterprises union, highly valued the province’s efforts to improve the local investment climate.

In the near future, the Yantai union will make a fact-finding survey to prepare for building an alcohol production factory, an expressway from Ha Giang’s Thanh Thuy border gate to nearby Tuyen Quang province, and a mineral spring tourism site in Vi Xuyen district, he added.

Woodchip exports tumble, numerous difficulties remain

Woodchip exports in the first five months of 2016 were posted at 248 million USD, compared to 430 million USD during the same period last year, a fall blamed on multiple difficulties.

A workshop in Hanoi on July 15 looked into new challenges to Vietnam’s woodchip exports.

The Vietnam Timber and Forest Product Association attributed the drop to the recent price nosedive in the global market, along with the decline in demand in China – the world’s biggest woodchip consumer.

Meanwhile, Vietnam has levied a tariff rate of 2 percent on woodchip exports to reduce the overseas shipment of this commodity.

To Xuan Phuc, a representative of non-profit organisation Forest Trends, said the imposition of this tax rate amid excessive supplies and shrinking demand has added a further complication to the export woodchip processing industry. The 2 percent tax is equivalent to 2.5 – 2.8 USD per tonne.

Though it is good to curb woodchip shipments to ensure material supplies for domestic processing, the effectiveness of the tax solution should be thoroughly assessed, he said.

Other experts said difficulties facing this industry include not only supply and demand changes but also the uncontrolled and rapid development of the sector.

Nguyen Nhu Xuan, Deputy Director General of the Vietnam – Japan Chip Corporation Ltd (Vijachip), suggested authorised agencies delay or lift the export tariff, giving producers enough time to prepare for in-depth processing.

However, Deputy Minister of Agriculture and Rural Development Ha Cong Tuan said the State’s consistent viewpoint is to cut down the proportion of woodchip in the export structure. An export tariff on woodchips had been discussed for five years, so the 2 percent rate imposed is not a surprise.

The supply and demand relation is the root of the problem. If industry insiders fail to forecast changes, the problem will never be solved, he added.

At the workshop, participants said the decline in demand for woodchip seems likely to prolong until late 2016, which will limit woodchip exports this year at around 7 million tonnes in volume and 600 million USD in revenue, equivalent to about 60 percent and 50 percent of last year’s respective figures.

Technology vital for boosting agriculture

 Inventing and applying new technologies has become an urgent task for Vietnamese businesses amid the country's international integration, especially in agriculture, a conference heard in the Cuu Long (Mekong) Delta province of Hau Giang yesterday.

"This year, the national technology map for rice seed selection will be completed," Ta Viet Dung, head of the Ministry of Science and Technology's Technology Application and Development Department told the event held to discuss Supporting, Promoting Technology Application and Innovation by Enterprises under the Value Chain.

"The map will enable relevant authorities to set up strategy, policy and technology programmes and improve companies' competitiveness."

Tran Duy Quy from the department said, "Rice seed selection technology has significantly increased rice capacity from three tonnes per hectare in 1986 to 5.77 tonnes in 2015."

Last year 255 rice strains were grown on Viet Nam's 7.66 million hectares of paddies, with 66 of them – including five stick rice varieties and 15 hybrids — accounting for 91 per cent of the area.

The annual demand for rice seeds is around 1.2 million tonnes, with almost three-fourths of it from the Mekong Delta.

"Now Viet Nam is able to meet 100 per cent of its normal seed demand, and imports US$35 million worth of hybrid seeds," Quy said.

Seventeen institutes, universities and enterprises are creating new rice strains.

"There are a lot of new rice seeds created by them but only some survive and it is hard to control their quality during cultivation," Quy said.

With most rice strains being indigenous, they fetch low prices, he said, pointing out that no Vietnamese seed brands are exported.

Vietnamese scientists and researchers need to create rice strains that can resist diseases, drought, flooding and salinity, he said. "Viet Nam only has 38 – 61 per cent of the modern technologies required to create new seeds."

He suggested instituting a national programme to develop quality rice seeds by 2035.

"The Government should offer incentives to attract private enterprises into research, strengthen copyright protection, set up exhibition areas in various places and assist enterprises with human resource training and international co-operation."

In 2015 Viet Nam was one of the leading rice exporters in the world with an 18.3 per cent market share, mainly focusing on cheap varieties and shipping 6.56 million tonnes for $2.68 billion.

"There are a lot of seeds in Viet Nam but none would be good enough to produce the best rice," Dao The Anh, deputy head of the Field Crops Research Institute, said.

"Most post-harvest technologies are backward and [as a result] production of rice by-products is low.

"Technologies required for the whole rice production process, from cultivation and harvesting to preservation, must be boosted to meet the development needs," he said.

LAS issues shares, raises capital

 Lam Thao Fertilizers and Chemicals JSC (LAS) would issue more than 35 million shares as bonus to its existing shareholders soon.

After the issuance, LAS' charter capital will increase from VND778 billion to VND 1.13 trillion, corresponding to 112.8 million shares on the HA Noi Stock Exchange

Based in the northern province of Phu Tho since 1962, LAS produces fertiliser and other chemical products to serve the northern market. Currently, the State-run Viet Nam National Chemical Group with nearly 70 per cent of the stake is the firm largest shareholder.

In 2016, LAS planned a sale of VND4.7 trillion and a profit after tax of VND436 billion as well as a 15 per cent dividend.

Vietnam Railways to sell 51% stake in Virasimex

Vietnam Railways has offered 51.13 per cent of charter capital in Railway Import - Export and Supply Material Equipment JSC (Virasimex) on July 19, the Ha Noi Stock Exchange said.

The stakes or about 1.6 million shares would be auctioned in a whole lot at the starting price of VND27.47 billion or VND17,200 per share, respectively. Investors wishing to participate in the auction have to deposit 30 per cent of the deal or VND8.24 billion.

Eighteen investors, which included nine individuals and nine organisations had qualified to participate the auction, HNX said.

Based in Ha Noi, Virasimex mostly trained and exported the labour force to the regional and international markets.

Telecom firms should focus more on quality: minister

Deputy Minister of Information and Communications Pham Hong Hai has said telecom companies should grow substantially, offering better quality and customer care services, instead of just promotions and discount campaigns.

Hai was speaking at a meeting on Thursday in Ha Noi, held to review the business performance of Vietnam Mobile Telecom Services (Mobifone) in the first six months.

He said Viet Nam had three large local telecom firms, but promotions and discounts remained a major focus of these companies. This was unsustainable development.

According to the Vietnam Telecommunications Authority, it is currently studying how to manage promotions more effectively by preventing large network providers from running rampant promotional campaigns. Some even offer promotions below their production costs, leading to unfair competition.

A policy to manage new promotions stipulates that if a telecom firm offers too many promotions against its revenue ratio, it will lead to problems affecting its business performance. Hai said network providers should maintain their market shares along with giving positive and sustainable competition, such as by offering quality services and customer care.

Too many promotion campaigns resulted in a large volume of new subscribers, while revenues did not rise, Hai said.

The information and communications ministry (MIC) has asked network providers to announce their 3G coverage areas, and has asked Mobifone to invest more in telecom infrastructure, Hai said.

The announcement of their 3G coverage areas is aimed at promoting healthy competition, just as other countries have done. Therefore, the ministry would soon consider applying it in Viet Nam, he said.

The number of newly built base transceiver station (BTS) is an important factor in assessing the ability of network providers in the time to come.

Investment in infrastructure development has become more important as the government has agreed to grant 4G licences by the end of the third quarter.

Le Nam Tra, CEO of Mobifone, said this was the first year Mobifone, the country's second-largest mobile services operator in terms of subscribers, piloted its 4G and MobiTV services on July 1 by depending on four pillars of cell phone, retail, television and multimedia services.

In the first six months, Mobifone earned VND17.4 trillion in revenue, bringing an after-tax profit of 2,336 billion.

A seminar on promoting the application of technological advances in the product value chain took place in the Mekong Delta province of Hau Giang on July 14, which was a major event within the framework of the Mekong Delta – Hau Giang economic cooperation forum 2016.

Speaking at the event, deputy head of the Steering Committee for the Southwestern Region Tran Minh Thong suggested the Mekong Delta build a regional farm produce quality monitoring centre, launch new models in choosing varieties, and adopt post-harvest preservation technologies in the value chain of agricultural production, focusing on rice, farmed fish and fruit.

Vice Chairman of the provincial People’s Committee Dong Van Thanh said technological adoption is expected to lower costs and meet food safety requirements, towards bringing more Vietnamese products to global markets.

Co-hosted by the Ministry of Science and Technology, the Steering Committee for the Southwestern Region and the provincial People’s Committee, the event discussed improving the efficiency of the value chain of rice production in large-scale fields, recommended advanced technologies used in fruit cultivation, suggested connectivity models for the aquaculture value chain, as well as technology transfer for the Mekong Delta.-

Seminar on international economic integration held in Tien Giang

A seminar to disseminate information on the free trade agreements (FTAs) Vietnam has signed was held on July 14 in the Mekong Delta province of Tien Giang.

At the seminar, Deputy Minister of Industry and Trade Tran Quoc Khanh briefed participants on the contents of the Trans-Pacific Partnership (TPP) and the FTA between Vietnam and the European Union (EU), including import-export duties, service and investment, intellectual property protection and e-trade.

The deputy minister also mentioned the opportunities and challenges brought by the FTAs.

He said those deals will help boost trade between Vietnam and the EU and the TPP participating member nations, adding they will also open up a new chapter in improving economic growth, creating more jobs and raising income, he added.

However, Khanh recommended localities update information, grasp international commitments, speed up administrative procedure reform and promote competitiveness.

The trade deals will allow Vietnam to boost its Gross Domestic Products (GDP) by 23 billion USD in 2020 and over 33 billion USD in 2025 while the country also expects to add approximately 70 billion USD into its export revenue.

Vietnam is likely to be the biggest winner of the TPP as the reduced custom duties will trigger more exports of Vietnamese products, particularly garment & textile, footwear, seafood, farming and forestry products.

New-style cooperatives piloted in Mekong Delta

The new-style cooperative model will be piloted in the Mekong Delta from 2016 to 2017, an official said at a conference in Hau Giang province on July 14.

This is the first phase of a scheme to pilot and replicate the new-style cooperative model in the Mekong River Delta in the period of 2016-2020, according to Nguyen Van Doan, head of the Ministry of Planning and Investment (MoPI)’s Cooperative Department.

Priority will be given to consolidating and restructuring the operations of all regional existing cooperatives in line with the Law on Cooperatives 2012, while increasing the numbers of members and their capital contribution.

The project also encourages the establishment of cooperatives in rice, fruit and seafood, while offering incentives to cooperatives and cooperative unions involved in agricultural value-chains.

The MoPI will propose to the Government to give support to cooperatives that develop under an autonomous financial mechanism.

Under the project, training courses will be conducted to build the capacity of cooperative managerial and technical staff. It will strengthen connectivity in agricultural production, expand consumption markets, and develop the infrastructure facilities of cooperatives.

Director of the Hau Giang Department of Agriculture and Rural Development Nguyen Van Dong pointed to the significant role of human resources in the efficient operation of new-style cooperatives, saying that they need to lure skilled and young intellectuals in the cooperative management boards.

According to Deputy Minister of Agriculture and Rural Development Tran Thanh Nam, the project will bring about a breakthrough in agriculture development in the Mekong Delta, particularly in the fields of rice, fruit and aquatic farming.

The project aims to help farmers overcome disadvantages in the market, increase their benefits through a link to the agricultural value-chain, thus improving the socio-economic and cultural living conditions for local farmers, Nam said.

The scheme to pilot and replicate the new style cooperative model in the Mekong River Delta in the period of 2016-2020” was approved by the Government in March 2016.

Solutions to ensure budget collection plan

The tax sector has devised multiple measures to ensure the budget collection target is met in the second half of this year.

Accordingly, local taxation departments review and propose to provincial People’s Committees and relevant ministries policies and mechanisms to create a favourable business climate to support the development of enterprises.

The agencies will give advice to local authorities on the establishment of a steering committee on boosting and managing the state budget collection. They also target a year-on-year increase of 14-16 percent in budget collection.

Other efforts include enhancing forecast and analysis abilities to make timely assessments on factors that may affect the plan, and creating a feasible projection of budget collection based on data on economic situation and collection policies.

Weekly exchanges with taxpayers will be organised to address difficulties faced by enterprises, contributing to improving the investment environment. Classification of taxpayers will also be conducted for better management.

According to the General Department of Taxation, state budget collection in the first half of this year was estimated at 393.55 trillion VND (about 17.7 billion USD), an increase of 6.3 percent over the same period last year.

The amount represents 48.6 percent of the whole year’s estimate.

Among the 63 localities across the nation, 45 attained at least 50 percent of the year’s estimate for domestic collection, while 57 exceeded their collection for the same period last year.

The shortfalls seen in the other localities mainly stem from increasing numbers of company dissolutions, bankruptcies and halting of operations. Other factors include natural calamities and the plunging price of crude oil.

Industry insiders talk Brexit’s effects on Vietnamese wood sector

Industry insiders discussed the impacts of Britain’s exit from the European Union (EU) on the Vietnamese wood sector during a workshop in Hanoi on July 14.

The event was jointly held by the Vietnam Good and Forestry Product Association (VIFORES), Ho Chi Minh City Fine Arts and Timber Processing Association, Forest Products Association of Binh Dinh (FPA Binh Dinh), and international Forest Trends.

According to the VIFORES, Vietnam is one of the three biggest wood exporters to the UK besides Indonesia and Malaysia. The UK is also the largest EU importer of Vietnam’s timber products.

In 2015, Vietnam exported wood and timber products worth about 900 million USD to the EU, including 270 million USD to the UK which singly made up 4 percent of the total timber export turnover of Vietnam.

Secretary General of the FPA Binh Dinh Tran Huy Le said the UK is the second most important market (after Germany) for wood companies in the central province of Binh Dinh.

That the UK left the EU had impacts on businesses’ orders, he said, noting that some customers demanded to cut prices by 5-7 percent while some asked to reduce the number of orders.

To Xuan Phuc from Forest Trends said Brexit caused devaluation of the pound, which negatively affects Vietnam’s wood export prices. Additionally, the decreasing demand in house construction in the UK will directly impact on the Vietnamese wood sector, he added.

The volume of timber products imported from Vietnam to the market is likely to reduce in the future, he said.

The UK has pioneered in implementing the EU Timber Regulation (EUTR) and negotiating the Voluntary Partnership Agreement (VPA) under the Forestry Law Enforcement, Governance and Trade (FLEGT) for countries exporting tropical timber products to the EU, experts said, adding that Brexit does not affect the FLEGT VPA negotiation between Vietnam and the EU.

Phuc suggested businesses update information and map out solutions to deal with different market scenarios because there would be changes on tax, exchange rate, customs fees and procedures in the future.

According to the Ministry of Industry and Trade’s Department of Import and Export, Vietnam’s goods exports to the UK make up about 2.9 percent of the total export turnover, so Brexit will not affect much on the exports of Vietnam.

Alarm for FDI sector in environmental protection

The foreign direct investment (FDI) sector, which has significantly contributed to the growth of the Vietnamese economy, has on the other hand posed negative impacts to the nation’s ecosystem with a number of environmental destruction cases, seriously affecting the public health.

Some experts hold that the main reason behind the situation is FDI enterprises’ poor observation of regulations on environmental protection in Vietnam.

A recent survey by the University of Economy under the Hanoi National University showed that 45% of 150 FDI firms in 2011 did not apply a low-emission production process, while 69% said they would not implement the process if they were not obliged to, and 57.7% took high cost as an excuse.

Currently, only 66% out of a total of 289 industrial parks nationwide have a concentrated wastewater treatment station. Especially, up to 75% of industrial parks and 85% of industrial clusters in the Mekong Delta are yet to be equipped with such facility.

At the same time, FDI projects in Vietnam, mostly run by Asian investors, have medium technology using large amounts of natural resources and releasing high emissions.

According to the Central Institution for Economic Management, as of 2013, only 5% of FDI firms in Vietnam own high technology, while about 80% of them operate medium technology and the remaining percent use out-of-date technology.

Between 2011 and 2015, FDI mostly flowed to such areas as apparel, chemicals, electronics, paper and iron with many latent risks of environment pollution.

Meanwhile, from 1988 to 2013, only 28 out of 16,000 FDI projects, or 0.2%, were launched on wastewater treatment, with only US$710 million or 0.36% of total registered investment.

Some serious environmental incidents have been recorded, changing the ecosystem and affecting economic growth and social security at the sites.

Notably, the Vedan company in the southern province of Dong Nai released its untreated wastewater to the Thi Vai River over 14 years, while the Miwon company in the northern province of Phu Tho let 900 cubic meters of wastewater out to the Red River. Most recently, Formosa Ha Tinh’s poisoning wastewater caused mass fish deaths along the country’s central coasts.

In order to prevent negative impacts on the environment by the FDI sector, experts held that it is crucial to prioritise projects from developed countries with a good sense of environmental protection, while strengthening the effectiveness of state management over the FDI sector’s environmental conservation.

Solutions to ensure budget collection plan

The tax sector has devised multiple measures to ensure the budget collection target is met in the second half of this year.

Accordingly, local taxation departments review and propose to provincial People’s Committees and relevant ministries policies and mechanisms to create a favourable business climate to support the development of enterprises.

The agencies will give advice to local authorities on the establishment of a steering committee on boosting and managing the state budget collection. They also target a year-on-year increase of 14-16 percent in budget collection.

Other efforts include enhancing forecast and analysis abilities to make timely assessments on factors that may affect the plan, and creating a feasible projection of budget collection based on data on economic situation and collection policies.

Weekly exchanges with taxpayers will be organised to address difficulties faced by enterprises, contributing to improving the investment environment. Classification of taxpayers will also be conducted for better management.

According to the General Department of Taxation, state budget collection in the first half of this year was estimated at 393.55 trillion VND (about 17.7 billion USD), an increase of 6.3 percent over the same period last year.

The amount represents 48.6 percent of the whole year’s estimate.

Among the 63 localities across the nation, 45 attained at least 50 percent of the year’s estimate for domestic collection, while 57 exceeded their collection for the same period last year.

The shortfalls seen in the other localities mainly stem from increasing numbers of company dissolutions, bankruptcies and halting of operations. Other factors include natural calamities and the plunging price of crude oil.

Opportunities for food and beverage businesses boost trade

Both domestic and foreign food and beverage enterprises will have a chance to promote trade and expand business while attending the Vietfood & Beverage and ProPack international exhibition, scheduled for August 10-13 in Ho Chi Minh City.

The exhibition will feature 500 booths of 425 new and well-known firms from 20 countries and territories worldwide, including China, Germany, Malaysia, Poland, Taiwan (China), Thailand, the Republic of Korea and Vietnam, said the Vietnam National Trade and Advertising Company (Vinexad).

This is also an opportunities for well-known domestic businesses like Habeco, Sabeco, Tan Hiep Phat Group, Vissan and Vifon to consolidate their positions on the market along with introducing their latest products, seeking partners and learning about customers’ demands.

This year, domestic manufacturers will bring to the exhibition clean products cultivated and processed in line with environmentally-friendly and non-toxic standards such as organic rice, honey, bird nest and cereals.

Highlight of the event will be the display of processed poultry products from the Associations of Poultry Processor and Poultry Trade in Poland and the European Union. The associations’ member businesses will provide consultations on bio-farming methods as well as new methods in food processing and preserving.

Business-to-business (B2B) meetings will be organised during the exhibition to connect domestic and foreign poultry businesses.

The food and beverage processing industry has great potential in Vietnam. Being a tropical agricultural country, Vietnam has abundant resources – a significant input for the processing industry. A large domestic consumption market with low labour costs coupled with strong equitisation of food enterprises has made the sector full of vitality, according to the organising board.

The exhibition was first held in 1996. After 19 exhibitions witnessing significant and rapid changes in the market, from the initial purpose of serving consumers' basic needs, the food and beverage industry has become a sector with considerable market share accounting for 15 percent of the gross domestic product, and it will continue to grow.

Hanoi: export revenue hit over 5.2 billion USD in first half

Hanoi reeled in more than 5.2 billion USD through exports in the first six months of 2016, up 0.1 percent year-on-year, according to the municipal Department of Industry and Trade.

Exports with good growth included garment-textile which brought in 711 million USD, followed by machinery-equipment-component (612 million USD), and means of transport and spare part (396 million USD).

Electronic products, footwear and leather goods and handicrafts also posted increases in export revenues.

By contrast, computer components and agricultural produce saw lower turnover compared to the equivalent period last year.

In June alone, the capital city earned 926 million USD from exports, increasing 3.2 percent from May.

Overall, Hanoi has recorded robust economic performance in the first half of 2016, with its gross regional domestic product (GRDP) gaining 7.3 percent. The capital’s agro-fishery sector grew 2.1 percent year-on-year in the period, while the industry and construction sector secured an annual growth of 7.8 percent.

LG Innotek says considering building camera module plant in Vietnam

The Republic of Korea's LG Innotek Co Ltd said on Wednesday it is considering building a plant in Vietnam to manufacture camera modules, without disclosing further details.

The Korea Economic Daily newspaper reported earlier in the day that LG Innotek plans to build a camera module plant in response to demands from smartphone camera module clients like LG Electronics Inc and Apple Inc, citing unnamed sources.

LG Innotek said in a regulatory filing that no specifics for a Vietnam plant have been determined.

Vega Balls unveils plans for new factory in Quang Ninh

Vega Balls Manufacturing Co Ltd, a leading producer of sports balls with production facilities located in Taiwan, Thailand and Vietnam has announced plans to construct a second plant in Vietnam.

The new 32,400 square metre facility will be located at the Dong Mai Industrial Park in the northern province of Quang Ninh. No specific details on the estimated cost have been released.  

It is expected to be placed into operation in early 2017.

Cai Mep-Thi Vai port improvement

Spurred by numerous complaints of underdeveloped infrastructure, logistics service shortcomings and fierce competition made by foreign joint venture ports in the Cai Mep-Thi Vai port complex in the southern province of Ba Ria-Vung Tau, the Ministry of Transport is now moving forward measures to increase its operational efficiency.

At a meeting with the local authorities in early July, Minister of Transport Truong Quang Nghia agreed with proposals from the province’s  leaders concerning the addition of some dry port locations, the building of a logistics centre, and the construction of the Bien Hoa-Vung Tau expressway, connecting the Cai Mep-Thi Vai port complex to the southern economic hub and nearby provinces.

“Soon the Ministry of Transport (MoT) and the Central Economic Commission of the Communist Party of Vietnam will have a specific working programme with the local authorities before deciding what the most efficient measures to improve the local ports’ competitiveness may be,” Nghia noted. “In addition, we will dredge to increase the channel depth from 14 metres to 15.5 metres in the near future, to facilitate larger vessels.”

As the only port complex in Vietnam shipping goods directly to the EU and America, the Cai Mep-Thi Vai port complex has 17 operational terminals. However, “the Cai Mep-Thi Vai port complex is like a beautiful house with no proper entrances,” said Secretary of the Ba Ria-Vung Tau Party Committee  Nguyen Hong Linh.

“The sooner the Bien Hoa-Vung Tau expressway is developed the more product volume the port complex can receive,” added Nguyen Van Trinh, Chairman of the Ba Ria-Vung Tau People’s Committee, proposing that the MoT invest in the Bien Hoa-Tan Thanh route in the short term and then enlarge to Vung Tau at a later date.

For years, underdeveloped infrastructure and logistics service shortcomings have remained the biggest problems facing several joint venture ports, namely SSIT, a joint venture between Vinalines and Carrix/SSA, SP-PSA (a joint venture of Vinalines and Singaporean PSA), and CMIT (a joint venture of Vinalines and Danish company APMT). These ongoing problems have made the Cai Mep-Thi Vai port complex less attractive to transport firms.

“It is costly to transport goods from Ho Chi Minh City or the southern province of Binh Duong to Cai Mep-Thi Vai, as the complex does not have yards available for empty containers, forcing enterprises to bring their goods to Cat Lai port in Ho Chi Minh City instead,” said Nguyen Thanh Tam, deputy director of Ho Chi Minh City-based company InterLog.          

It costs up to VND4.3 million (around $192) to transport goods on a 40-kilometre section from Dong Nai’s Nhon Trach district to Cai Mep-Thi Vai, but only VND3.3 million ($150.6) to bring goods 80 kilometres from Nhon Trach to Cat Lai.

In addition, transporting goods to other Asian countries from Cai Mep-Thi Vai takes over ten days, compared to only three days from Cat Lai port in Ho Chi Minh City, leading enterprises to avoid Cai Mep-Thi Vai altogether, he added.

Another big concern facing foreign joint venture ports is shortfalls in comprehensive and sustainable port master planning and development. This problem is yet to be solved.

According to an official at a joint venture port, the Cai Mep-Thi Vai port complex is  moving cargo lower than its design capacity, this is due to competition from ports in Ho Chi Minh City and Binh Duong. The expansions of Phu Huu and Hiep Phuoc ports have caused further difficulties for the joint venture ports in Cai Mep-Thi Vai.

After years of trouble attracting cargo, Cai Mep-Thi Vai saw growth of 44 per cent of volume in the first six months of this year, with the number of over 100,000 dead weight tonnage vessels increasing, according to the MoT. It was expected that the volume of goods through this port complex would pass 80 million tonnes by late 2016.

VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR